What is an Occupation Class Regarding Physician Disability Insurance?

If you are a physician shopping for occupational disability insurance, you may have come across the term “occupation classes.”

There are serious implications for different occupation classes, so it’s important to know which classification your occupation falls under. Keep reading to learn more about occupation classes regarding physician disability insurance.

Occupation Class

Insurance companies lump several occupations into various classes, in order to simplify the purchasing process. Each company handles this in their own unique way, but the following are the standard categories:

  • 1A
  • 2A
  • 3A
  • 4A
  • 5A
  • 6A
  • 4M
  • 5M

Typically, the higher the classification number, the lower the insurance rate will be (excluding other elements such as age, health, and income).

A Sample Breakdown of the System

  • “M” is for medical professionals
  • Salespeople tend to fall under 2A-5A, depending on the following factors:
    • Income
    • Nature of the sales
    • Length of employment
  • Nurses usually fall under 2A
  • Most engineers fall under 4A or 5A
  • Most executives fall under 5A or 6A

How Occupation Class Impacts Coverage

Occupation class can impact coverage in at least the three following ways:

  1. It can impact the amount of your monthly benefit.
    1. The amount of coverage you receive depends on your level of income. Occupation classes help insurers determine the amount of coverage they’ll have to pay you in the event you need to receive the benefit.
  2. It can limit your ability to obtain own-occupation definitions in your coverage.
    1. Your occupation classification will be used to determine whether your policy will have an “own-occupation” or “any-occupation” definition. Most occupation classes of 4A, 4M, or higher will offer “own-occupation” as the base definition of the policy. Other occupation classes, such as 2A and 3A are typically offered an “any-occupation” base definition.
  3. It can limit how much mental/nervous coverage you can obtain.
    1. It’s common for disability insurance companies to only offer two years of coverage for mental or nervous disabilities. However, certain companies offer more lenient or strict coverage for these disabilities depending on the occupation class.
    2. For example, a company may provide up to five years of benefits for mental or nervous disabilities for 3A and 4A benefit classes, but the benefit period may be limited to just two years if you are a 4M or 5M occupation class.

Shopping for disability insurance can be a complicated and time-consuming process. If you need assistance applying for disability insurance benefits or your claim for benefits was denied, our team may be able to help.

We have helped many other people in similar situations, and we may be able to help you, too. Don’t wait—contact our office right away with any questions you may have.

Call Dabdoub Law Firm today at (800) 969-0488 to speak with an attorney about your case.

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